Finland

Finnish legislation does not impose restrictions on foreigners wishing to organize an enterprise in this country, which can be established in such organizational and legal forms as:

* Self employed
* Partnership
* Open joint stock company
* Private limited company
* Cooperative enterprise

As a rule, at least one of the founders of any Finnish company must be a resident of the European Union, and the registration of a business with 100% foreign participation will require permission from the National Board of Patents and Registration of Finland.

Self employed

In order for a non-resident of the European Union to register in Finland as a private entrepreneur, he (she) will need to obtain a work permit and a residence permit in this country. An entrepreneur solely owns and operates his business in Finland and is unlimitedly liable for the debts and obligations of a private company.

Partnership

There are two types of partnerships in Finnish law - general partnership with unlimited liability and limited liability partnership.

General partnership with unlimited liability is established by at least two partners, without the need to pay any capital and has the following features:

* all partners (individuals and legal entities) are equal and bear unlimited equal liability for the debts and obligations of the enterprise;
* partners are not free to transfer their rights to third parties without a corresponding decision of the general meeting;
* the enterprise is managed by general partners in accordance with the memorandum of association.

A limited liability partnership is established by at least two individuals or legal entities (one of which must be the general partner), without the need to pay any capital and has the following features:

* general partners bear unlimited liability for debts and obligations of the business;
* other partners are liable for obligations of the partnership only within the limits of their shares;
* partners are not allowed to transfer their rights and interests to third parties without a consent of the other patners;
* the partnership is managed by general partners in accordance with the Articles of association. If other limited partners take part in the management, they lose their limited liability status and bear unlimited liability along with the general partners.

Open Joint Stock Company

An open joint stock company can be established by one shareholder and has the following features:

* capital must be paid within a month from the date of registration of the company;
* company's shares could be freely offered to third parties;
* the company is governed by a Board of Directors, in which at least the CEO and one of the directors of the Board must be residents of the European Union.

Private limited company

A private limited company can be incorporated by one shareholder and has the following features:

* capital is paid in full at the time of registration of the company;
* free offer of shares to third parties is not permitted;
* a sole director is allowed, but a majority of directors must be residents of the European Union.

Cooperative enterprise

Although this form of business activity in Finland is rarely used by foreign investors, it has a specific feature. All its founders (at least 3, individuals and legal entities) are entitled to be non-residents of the European Union.

Taxes

Finnish companies and cooperative enterprises pay income tax at a flat rate. Partnerships are not considered as independent tax subjects in Finland.

The partnership's income is distributed among the participants according to their shares and is taxed at the place of residence of the partners themselves.

The income of a self employed is subject to personal income tax on a progressive scale.

Finland Double Taxation Agreements

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